Summary
The greatest investment advisor of the twentieth century, Benjamin Graham taught and inspired people worldwide. Graham’s philosophy of “value investing” — which shields investors from substantial error and teaches them to develop long-term strategies — has made The Intelligent Investor the stock market bible ever since its original publication in 1949.
Over the years, market developments have proven the wisdom of Graham’s strategies. While preserving the integrity of Graham’s original text, this revised edition includes updated commentary by noted financial journalist Jason Zweig, whose perspective incorporates the realities of today’s market, draws parallels between Graham’s examples and today’s financial headlines, and gives readers a more thorough understanding of how to apply Graham’s principles. – Amazon.com
Review
This book is arguably the most important book on value investing. Warren Buffet, who studied under Benjamin Graham, has called it “the best investing book ever written”. This book is an easier read than his much more detailed Security Analysis and its contents range from portfolio policy, the basics of fundamental securities analysis and stock selection, and the idea of “margin of safety”. He also outlines different plans for the people who don’t want to think about their investments (“defensive”) and the person who is willing to work hard to maximize returns (“enterprising”). The newest version contains an update, written by Jason Zweig, that points out just how timeless Graham’s principles are in this increasingly changing world.
My favorite aspect of the book: Graham does not try to use flash and mirrors to encourage you to invest in stocks. He plainly tells you the difficulty in investing and proceeds to encourage you to really analyze how much time you are willing to spend learning this area. If the answer is little, then you are simply guided to an index fund.
My least favorite aspect of the book: Since the book was written decades ago, the examples provided consist of industries that are not as prevalent today. This is mitigated to an extent by the update after each chapter by Jason Zweig. He helps you relate his principles to today’s world, making particular use of the tech bubble of the late 1990’s
Nikolai’s rating: 5 stars.